Auto Execs Smell Blood As Elon Musk Grows ‘Desperate’ To Make Tesla Work
Senior automotive executives are starting to poke a little fun at Tesla CEO Elon Musk as the tech entrepreneur tries to keep the California electric car maker from falling behind on important deadlines.
Auto executives are not impressed with the gains Tesla has made on Model 3 production. One executive believes Musk is growing increasingly desperate as Tesla struggles to keep pace with the high expectations its CEO continues to make.
“He has achieved a lot by sheer willpower and is one of the most gifted people I’ve ever met,” Bob Lutz, who has occupied senior executive positions inside of the country’s largest automakers, told The Washington Post in an interview. “He’s also one of the most flawed.”
Musk is a “master salesman” and the titular head of a type of “religious cult” that never sways from the church of Elon, Lutz noted. “But he’s getting desperate … Like so many of these schemes, I think he’s rapidly running out of other people’s money,” Lutz added. Wall Street analysts have been making the same argument for the past two years.
Some analysts suggest Musk and Tesla are operating a type of Ponzi scheme designed to use customer deposits to prop up the beleaguered company’s fledgling production capacity. (RELATED: New Market Report Calls Tesla A ‘Ponzi Scheme’ Similar To Enron)
Tesla’s ability to raise more capital took a hit in March when Moody’s dropped the company’s credit rating and changed the outlook to negative as Model 3 production dwindled. (RELATED: Moody’s Downgrades Tesla’s Credit Rating As Model 3 Slips Into Obscurity)
Musk promised to eventually produce 20,000 cars per month, but Tesla has managed to produce 5,000 Model 3s in June, a number well below the company’s initial projections. Moody’s labeled the electric car marker a substantial risk in March for investors willing to dive headfirst into the auto market.
Steven Armstrong, Ford president of Europe, the Middle East and Africa, poked fun at Musk for building a relatively small number of vehicles relative to his company. “7,000 cars, circa 4 hours. Ford Team,” Armstrong wrote in a July 2 tweet intended to highlight Tesla’s inability to reach an economy of scale large enough to compete with Ford’s massive output.
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